Fruits of Capitalism, Modernisation of Chilean Agriculture 1950-2000

Abstract: The so-called Chilean economic miracle during the 1980s and 1990s connotes not only high-speed economic growth but also a profound structural transformation of the Chilean economy. Most previous research ascribes growth and transformation to the liberalisation of markets and other neo-liberal policy instruments introduced after 1974. Policies, before as well as after 1974, have indeed been important for creating preconditions for growth and transformation. However, in the present study it is argued that by overemphasising the role of polices one may partly disregard the historical process by which capitalist forms of organisation have gained momentum in the productive system as new technologies worked have their way into the agricultural sector. In this study, the dynamics of the transformation of Chilean agriculture are analysed by using the methodological tools offered by the Dahménian theory of Development Blocks. Empirically the study delves into three different sub-sectors (wine, fruit and milk) with the purpose to portray the transformation of both export agriculture and traditional agriculture. The study focused technical renewal as a key part of the modernisation process. The main conclusion of the study is that the modernisation of Chilean agriculture was caused by the transformation pressure emanating from the market. However, the selective institutions that paved the way for the successful entry of capitalism in Chilean agriculture were ironically mainly created under the land reforms during the structuralist and socialist periods of the 1960s and early 1970s.